The Government has been warned that it must enter pay talks on a sector-by-sector basis as bus and train drivers prepare to confront employers over wage demands.

Wide-reaching public sector pay deals have been dismissed as unworkable by bus and train driver representatives as they prepare for hearings on their own disputes before Christmas.

Bus Eireann drivers' pay claims are due to be heard in the Labour Court on December 6. They are seeking the 11.6pc rise that was awarded to Dublin Bus drivers in October.

However, sources close to the Bus Eireann dispute fear the poor performance of commercial arm Expressway will dampen the likelihood that drivers will get what they want.

A spokeswoman for Bus Eireann said the company was expected to lose more than €5m this year.

She added: "Our Expressway services are wholly commercial routes that receive no State funding. The company incurred a €5.6m loss in 2015 and is forecasting a similar loss for 2016."

Irish Rail staff are also involved in a pay dispute due before the Workplace Relations Commission on December 7 after the National Bus & Railworkers' Union (NBRU) asked for rises in line with those handed to Luas drivers earlier this year.

But the company has been warned to shut lines or come up with an extra €128m a year to shore up its creaking balance sheet.

An Irish Rail spokesman said: "This engagement takes place in a continuing difficult financial environment, although we have in October reinstated pay for all employees following a 25-month temporary pay reduction of 1.7pc."

NBRU general secretary Dermot O'Leary said it was important pay talks were handled on a sector-by-sector basis, adding that deals such as the Lansdowne Road Agreement were not practical.

"I would be firmly of the view that pay talks in the future should be based on sectors. I don't think a one-size-fits-all approach works," he added.

O'Leary said pay rises were justified in the public transport sector, as workers have gone for eight years without an increase. "The people who suffered most during the downturn are the people being told to behave because they are looking for pay rises."